The year 2011 seems to be a year for the businesses, especially in relation to the mush required loans by the businesses facing financial problems. Over $30 billion were approved by The Small Business Administration (SBA) for the fiscal year 2011. This was part of the government’s guaranteed loan program which officially ended on 30 September.

If we compare it with the figures of $22.6 billion for the year 2010 it is indeed a very substantial increase. Businessmen in need of heavy loans and financial companies giving loans to the borrowers took full advantage of higher loan guarantees with reduced charges; the first quarter of the year saw $12 billion approved In Small Business Administration loans. This was only a little less than $1000 as compared to the same period of previous year, i.e. $60,711 in 2010 to $61,689 in 2011.

These negligible increases of the loan were mainly due to the increase in the size of the loan from a maximum of $2 billion to $5 billion and decrease in the number of loan from a minimum $ 150, 000. The year 2011 saw an increase in the size of the loan on the aggregate by almost $ 120,000. ( $ 237966 in 2010 to $ 365,508 in 2011).

SBA Loans are leaving a positive effect on various aspects of the market, on one hand it is increasing the business prospects and on the other hand the employment opportunities are also on the rise, as the expanding businesses are requiring more manpower. The default rate in case of heavier loans is much lower than those of smaller loans.

Businesses in need of smaller loan and not falling in the preview of Small Business Administration Loans have also been catered for. The lenders have been suitably authorized with incentives to provide small loans through community development organizations for small and low income business.